HISTORY AND THE NUMBERS SHOW THAT MAINTAINING A STRONG CORPORATE CULTURE IS THE KEY TO SUCCESS
Astrong culture is the single greatest competitive advantage an organization can have, says Marty Parker.
He should know. Parker is founder/CEO of Waterstone Human Capital, an executive search and cultural talent management firm that specializes in finding job candidates that fit the unique cultures of its clients.
“You can copy strategy,” says Parker, author of Culture Connection: How Developing a Winning Culture Will Give Your Organization a Competitive Advantage. “You can take people. But culture being the collective behaviour of an organization — the how you do things; the norms of behaviour — it’s almost impossible to duplicate that. So if you can align your culture to your human capital systems it will drive performance and, as a result, we believe it’s a competitive advantage.”
Each year since 2004, Waterstone has honoured Canada’s 10 Most Admired Corporate Cultures. Now one of the largest organizational awards programs in Canada, honorees reflect the benefits of strong corporate cultures that have great impact on their performance.
Over its 11 years, program winners have outpaced the S& P/ TSX 60 Composite — Canada’s biggest and best — in three-year average revenue growth by 850 per cent.
Whether you create it or it creates itself, Parker says the key is to identify what your culture is, articulate it and align it to recruitment, training, compensation and recognition. To help organizations do this, the firm developed the Waterstone Culture Dashboard, an annual survey that helps companies identify and articulate their culture, and benchmark that culture against the behaviours that drive winning cultures — specifically those of the Canada’s 10 Most Admired Corporate Cultures. It exposes an organization’s cultural strength and weaknesses: what works and what does not. The result? Greater performance.
For Lee Piccoli and his Guelph, Ont.- based homebuilding company, Fusion Homes, performance is not missing a closing date since he started 17 years ago. He says a strong corporate culture is the No. 1 reason for Fusion’s success.
Operating in four Ontario cities, Fusion began its unprecedented growth in 2009, going from $20 million in annual sales to more than $100 million in 2015 with projections of close to $200 million in 2017. Staff has grown to 130 from 15-20 in 2009.
Maintaining a high- performance corporate culture through tenfold growth has been one of Piccoli’s biggest priorities — and challenges — the last seven years. “We understand that our culture is the main reason why we’re successful with our business strategy and our vision and our purpose,” says Piccoli, who forged a strong, customer- centric culture when he started Fusion at age 25.
Culture, he says, is an outgrowth of vision, strategy, processes, recruitment and performance strategy.
“We’ve always kept that front of mind as we’ve grown. It’s not a matter of us telling everybody what we’re going to do from a values standpoint; it’s a matter of us creating mechanisms in the company to produce a certain culture as an output.”
Fusion started measuring culture as the growth began, identifying the values most important to its most successful staff and embracing them as its set of corporate values.
They’re applied in the company’s recruitment strategy and performance management, to name two.
Like a sports team, performance is No. 1 at Fusion. Recognition programs celebrate those who exhibit Fusion values, come through in the clutch and deliver customer satisfaction.
It works. Fusion has topped Tarion Warranty Corp.’s customer satisfaction index six of the last seven years.
At one of Canada’s biggest telecommunications providers, culture is everything. “For us, there is nothing more important than corporate culture,” says Sandy McIntosh, executive vice- president of people and culture at Telus. “It is the foundation of any and all success that we have.
“It’s an extremely competitive industry that we work in, and we go through lots of challenges that are not unique to us, but we put all our bets in the difference in our culture compared to our competitors and the unique attributes of our team.”
Seven years ago, Telus launched a new network and expanded its phone lineup. But executives, doubting they could forge a sustainable market advantage from products and networks alone, shifted emphasis to customer service.
The new strategy demanded a lot of Telus staff. At the time, employee engagement was only 53 per cent.
Head office dispatched its senior leadership team to experience what employees faced in the field, a new experience for about 75 per cent of them. “It was very eyeopening and a pivotal time in our culture for us to see the challenges through lenses of our customers and the team members who face them every day,” she says.
“From that point forward, we started to make a number of small and large changes that transformed processes, empowered team members and made our processes more friendly for customers.
“That was a big point for our team members to say ‘finally, our executives really get it.’ That was the turning point of making material changes for us.”
Job satisfaction rose; employee engagement soared to 87 per cent.
Award and peer recognition programs further encourage staff. Each Monday, president/ CEO Darren Entwistle issues a memo detailing a customer win or loss, encouraging staff to emulate or improve on behaviours.
It works. Quarterly results indicate Telus has the most satisfied and loyal customers of any North American provider; monthly, 99 per cent of customers choose to stay with Telus, and customer satisfac- tion is at 95 per cent.
At Cineplex Entertainment, president/ CEO Ellis Jacob has forged a corporate culture out of broad diversification and a multitude of mergers and acquisitions. It’s meant much hard work. Cineplex has grown from 65 locations in 2003, when Jacob led a Galaxy merger with Cineplex, to 161 theatres and more than 1,600 screens today. More than 70 million Canadians watched Cineplex showings last year, a 71 per cent market share.
Some 40 per cent of Canadian households have Scene rewards cards, which offer Cineplex discounts and free movies, and nearly 14 million Canadians have downloaded the Cineplex app, which provides trailers, ticket purchasing and other benefits.
“What you have to do is continue to communicate, always — do town halls, get across the country and have meetings with different levels of the organization,” says Jacob. “That’s absolutely critical. And, yes, it takes a lot of time but the most important part of it is that it basically creates a relationship across the organization.”
Besides employee recog- nition programs, Cineplex continually seeks input from all employees. Head office accumulates, synthesizes and implements the best ideas.
For Jacob it’s about nurturing a family atmosphere, valuing his employees and encouraging a do-unto-others attitude. “You’ve basically got to manage as a team together. We’ve got 13,000 employees across the country, and if you don’t ask people for ideas they won’t give them to you.”
It’s a mid-week afternoon and at the Purdy’s Chocolates factory in Vancouver, the boss and five executives are in the daily chocolate development meeting and bi-weekly chocolate-tasting. That’s when all 80 head- office staff try the latest creations by company master chocolatier.
It’s no wonder Purdy’s is perennially voted among Canada’s Top 50 employers.
President/CEO Peter Higgins, a chocolate scientist, is big on staff engagement. Everyone at Purdy’s, from accounting to IT to HR, is a trained expert in the very technical field of chocolate. It’s a months- long process that begins the day of hiring.
“Training and development is absolutely a key part of engagement and having a fantastic culture,” says Higgins. “We all are a team of chocolate experts. If we can show knowledge and passion to our customers, that’s going to be a stronger connection. Ultimately, that’s what we try to do around our training.”
Engagement at Purdy’s 75 locations in B.C., Alberta and Ontario with 1,000 staff has been a yield as natural as the 100 per cent sustainable cocoa it buys from co-operatives around the world.
The company, which also has a “robust” e- commerce site (purdy’s.com), puts a lot of stock in communication. There are daily meetings at the factory and the sevenmember executive t eam huddles for 15 minutes each morning, tastes chocolate and talks about the possibilities.
Employees are heavily involved in fundraising for local causes — more than $3 million this past year.
And the premiums Purdy’s pays for its cocoa, primarily in West Africa and South America, goes to farmers’ families, education that has doubled yields in some areas, and life- changing community projects like water wells and filtration.
“At the heart of our business are fantastic people,” says Higgins. “We try to do 10 times to the 10 the right things for our teams. It ultimately comes from having a team-first, people-first orientation.”
Marty Parker, CEO of Waterstone Human Capital: “You can copy strategy. You can take people. But culture being the collective behaviour of anorganization ... (is) almost impossible to duplicate.”